Preliminary Overview of the Economies of Latin America and the Caribbean 2012

This publication reveals that although Latin America and Caribbean (LAC) economies are set to grow, sub-regional performance has been varied. The growth observed in 2010 is consolidating the recovery that the majority of the economies in the region began to experience in 2009. This growth had positive effects on employment and private consumption. However, diverse factors came together in 2010 to create a less optimistic situation for the international economy that together with diminished public spending efforts suggest a decreased dynamism in LAC in 2011. In effect, the external environment continues to affect the region's economies given the high levels of uncertainty in the advanced economies. At the same time, the relative strength of emerging economies has led to an increase in the inflow of capital to LAC. This situation has led to currency appreciation. The challenge is to increase investment through increased national savings in order to better defend the exchange rate paritie